The number of Americans applying for initial jobless benefits jumped by 38,000 last week, although analysts say the 368,000 total remains within the boundaries that define a slowly growing job market. Separately, U.S. incomes were up in December, lifted by wage growth and dividend payments made ahead of higher tax rates.CNBC
(1/31)
,Reuters
(1/31)

S&P: China investment poses "highest risk" of correctionChina's high ratio of investment to GDP is pointing to the possibility of a correction, according to a report by Standard & Poor's. "What we found is that China has the highest risk of an economic correction because of low investment productivity over recent years. We believe the level of a country's investment overhang can be a leading indicator of a potential economic correction," said S&P credit analyst Terry Chan. China Daily (Beijing)
(1/31)

Another sign of rebound in Germany: Jobless rate dropsAdding to recent signs of a turnaround from a fourth-quarter contraction in Europe's leading economy, Germany's unemployment rate fell to 6.8% in January. "The German labor market convinced with a distinct robustness in the second half of last year and the beginning of this year. ... But it's too early to sound the all clear because the labor market reacts with delay to economic developments. Unemployment could still rise," said Heinrich Bayer, an economist at Postbank Research in Bonn. Bloomberg Businessweek
(1/31)

In the midst of its long-running recession, Spain's inflation rate eased more than expected in January. Separately, Mariano Rajoy, the prime minister who has led Spain through successive rounds of crushing austerity, has become embroiled in a corruption scandal involving allegedly secret cash payments to politicians.Bloomberg Businessweek
(1/31)
,Financial Times (tiered subscription model)
(1/31)

Pleased Chinese investors plan to plow more into EuropeNearly all of the 74 Chinese enterprises surveyed by the EU said they planned to raise their investments in Europe, with about 4 in 5 indicating plans for major increases. Among the favorable factors cited in the survey were a welcoming market unconcerned about security matters, access to advanced technologies and skilled labor, and a transparent legal environment. Xinhuanet.com (China)
(1/31)

Global lending conditions improve for emerging economiesEasy monetary policies in mature economies are cited for a positive turn in bank lending conditions for emerging markets, the first plus reading since the second quarter of 2011, according to the Institute of International Finance. The improvement was documented globally but was particularly strong in Asia. Xinhuanet.com (China)
(1/31)

Are the fiscal and monetary policy initiatives being undertaken by Japan's new government likely to lead the country out of the deflationary and slow-growth environment that has persisted for the past two decades?

No

58.57%

Yes

41.43%

Poll analysis:"Abenomics" (「アベノミクス」) and the new economic policies of Japan's Prime Minister Shinzō Abe, which feature fiscal and monetary expansion with an explicit 2% inflation target, are hailed by many to be the key to how Japan can show the rest of the world how to get out of prolonged deflationary economic stagnation. Nobel laureate Paul Krugman, known for his support of Keynesian economics, is in the frontline of the cheering squad, whereas many others doubt that these policies will change the situation that has persisted for the past two decades. As for readers of the global edition of the CFA Institute Financial NewsBrief, a majority of the 782 respondents (62%) do not believe that Abenomics can change Japan's economic stagnation; only 38% sided with Krugman. The readers of the Asia Pacific NewsBrief appear slightly more optimistic, with 41% siding with Krugman. -- Samuel Lum, CFA, Director, Private Wealth & Capital Markets, CFA Institute, and Alex Flatscher, CFA, Director, Code & Standards, CFA Institute

Market Activities

INTERNATIONAL MARKETS OVERVIEWUninspiring corporate earnings and a jobs report that injected uncertainty into the U.S. economic picture helped keep a lid on stocks in Europe and the U.S. on Thursday. The Stoxx Europe 600 declined 0.49% to 287.22, and the S&P 500 ended the day down 0.26% at 1,498.11. Here is a continuously updated list of global stock indexes. The Wall Street Journal
(2/1)
,MarketWatch
(1/31)
,CNNMoney
(1/31)

Asian shares fall backDisappointing earnings reports and unexpectedly weak economic indicators in the U.S. kept a lid on stocks across Asia on Thursday. The Nikkei managed a gain of 0.22% to 11,138.66, but the Hang Seng was down 0.39% at 23,729.53, the Kospi lost 0.13% to 1,961.94 and the S&P/ASX eased 0.37% to 4,878.80. MarketWatch
(1/31)

Amid mounting concerns among banks over nonperforming assets, growth in lending to Indian industry eased in December from a year before, according to India's central bank. Credit was up 13.8% in the latest month, down from the 19.8% rise in December 2011.The Economic Times (India)/Reuters
(1/31)

Glimmers of a pickup in South Korea's economy over the next few months are hedged in by a number of risk factors on the domestic and global fronts, according to officials in the Finance Ministry and at Statistics Korea. Korean production and investment figures are looking positive, but familiar problems in key export markets and the possibility of a lagging domestic market held down by household debt are key negative factors.The Korea Herald (Seoul)
(1/31)

Rising confidence in London as a locus for yuan-based swaps contributed to a 240% jump in such activity over the first half of 2012, topping US$3 billion a day, City of London Corp. reported. Yuan trading is encouraged by the U.K. government in a bid to improve ties to the Chinese economy.Bloomberg
(1/31)

Deutsche Bank predicts big things for its Asian businessDeutsche Bank is on track to double its earnings in the Asia-Pacific region between 2011 and 2015, says Gunit Chadha, its regional co-CEO. Citing growth both in Asia and globally, Chadha said a return of equity flows "will drive the custody end of transaction banking. As investment banking comes back, there will be more [mergers and acquisitions]; credit finance will increase, which will boost our fixed-income business." The Business Times (Singapore)
(1/31)